Payment And Vending Sales Increase 9 In Crane Cos Second-Quarter

» Excluding special items, earnings per diluted share (EPS) of $1.06 decreased 8%, compared with 2014 (GAAP EPS of $0.95 decreased 5%, compared with 2014)

» Sales of $711 million declined 5%, compared with 2014, driven by unfavorable foreign exchange

» Reducing 2015 EPS guidance to $4.10-$4.30, from $4.30-$4.50, excluding Special Items (revised GAAP EPS guidance of $3.90-$4.10)

STAMFORD, CT -- Crane Co., a diversified manufacturer of highly engineered industrial products, reported second-quarter 2015 earnings of $0.95 per diluted share, compared with $1 a share in the second quarter of 2014. Excluding special items in both years, second-quarter 2015 earnings per diluted share were $1.06, compared with $1.15 in the second quarter of 2014.

Second-quarter 2015 sales -- across Crane's four main business segments -- were $711 million, a decrease of 5%, compared with $750 million in the second quarter of 2014. The sales decline was comprised of a $39 million, or 5%, impact from unfavorable foreign exchange, and a divestiture impact of $4 million, or 1%, partially offset by positive core sales growth of $5 million, or 1%. The company's business segments are Fluid Handling, Aerospace/Electronics, Engineered Materials and Payment & Merchandising Technologies, which comprises Crane Payment Innovations and Crane Merchandising Systems.

In the Payment & Merchandising Technologies segment, Crane reported a sales increase of $2 million, driven by core growth of $17 million, or 9%, partially offset by $13 million, or 7%, of unfavorable foreign exchange and a $2 million, or 1%, divestiture impact. Adjusted operating margins expanded 340 basis points to 15.0%, driven primarily by higher volume, acquisition synergies and productivity initiatives.

Engineering Materials had a 4% sales increase in the second quarter, while sales in Fluid Handling, the largest segment, and Aerospace/Electronics were down 10% and 6%, respectively.

Companywide, operating profit in the second quarter was $90 million, down 8%, compared with the second quarter of 2014. Excluding special items, second quarter operating profit was $99 million, down 10%, compared with the second quarter of 2014.

"While overall second quarter sales and margins were largely as expected, orders in Fluid Handling were weaker than we anticipated," said Crane Co. president and chief executive Max Mitchell. "Order rates improved sequentially during the first quarter, but that trend did not continue into the second quarter. We now expect Fluid Handling sales to remain depressed for the balance of the year given an environment of continued project delays and soft end market conditions. Consequently, we are reducing the midpoint of our EPS guidance range by $0.20. We are taking appropriate cost actions in response to the current market weakness.

"We were pleased with another quarter of improved organic growth and margin expansion at Payment & Merchandising Technologies. Aerospace & Electronics performed as expected during the quarter, and both sales and margins are on track to improve in the second half."

Click here to see Crane Co.'s second-quarter income statement data.